The CentreCourt team decides to name their project Core Condos to emphasize its location in the heart of Toronto. The process of branding and marketing begins.
“It’s very much about standing out,” says David Klusberg, vice-president of L.A. Inc, the advertising agency hired by CentreCourt. “There’s a lot of competition.” To whet buyers’ appetites, the agency creates a “teaser website,” where people can register for more information about the project as it becomes available.
In December, Mr. Virani sits down with key brokers, giving them a sneak peak of some renderings, hoping to create excitement. About 50 agents who sold multiple units of CentreCourt’s prior projects come first. As the holidays close in, Mr. Virani does additional presentations for about 100 more agents. He tells them prices will range from the high $300,000 range for studios to about $775,000 for two bedrooms.
“Because we bought the land at the right price and we have the right execution on this, we want to be a value proposition to the buyer,” Mr. Hoffman says. The building ultimately comes out at just under $600 per square foot, slightly below average for the Toronto market.
Mr. Hoffman and Mr. Virani are hoping to be the first major downtown launch in 2014 and are targeting a mid-January date, but just before the holidays they hear rumblings that another building might come onto the market sooner. They kick into overdrive.
On Friday, Jan. 3, they release plans, prices and a digital brochure to agents. The agents then pitch the project to prospective buyers and submit “worksheets” to the developers that spell out the units their clients want and which floors they prefer.
Some developments provide “platinum brokers” – the ones who handle the most condo business – with a head start, allowing their buyers first crack at units. Instead, the CentreCourt team blanket the market, accepting worksheets from any agent, in an effort to sell the project as quickly as possible.
Five nights after the Jan. 3 release, with worksheets in hand, Mr. Virani and Mr. Hoffman start to allocate units. A key consideration is who the agent is – one who sells lots of units will get priority over one who rarely dabbles in new condos.
By Sunday morning 80 per cent of the building is sold. The CentreCourt team decides to raise prices, bumping up the cost of a suites by about $10,000. By the end of the weekend, the developer has 185 deals, meaning roughly 85 per cent of the building has sold out.
Everyone is surprised. In a market that is supposed to be cooling, they have managed to go from closing on a deal to buy the land to selling nearly all of the project within about 10 weeks.
“Other developers might have a mindset that if they sold out within 30 days, they’ve underpriced it, left a lot of money on the table,” Mr. Hoffman says. “We’d rather have 100 per cent sold, our deposits in, be very conservatively underwritten, and now focus on the construction.”
Mr. Habibzadeh’s real estate agent, Roy Bhandari, can’t get over it.
“When the guys here told me they were launching on the third of January, I told them, ‘You are absolutely crazy,’” he says, sitting in the sales office while Mr. Habibzadeh finishes his paperwork.
“I was literally still in my Christmas pajamas, and I’m like, ‘Nobody is buying condos at this time of year, you’ve got to wait at least a couple of weeks.’ But you know what? [They were right.]”
The development of Core Condos
Bruce Feldman and partner buy two properties in heart of Toronto, near Church and Shuter streets, zoned for 10 storeys.
Mr. Feldman begins the process to rezone the land.
CentreCourt signs deal to buy the site, conditional on rezoning. Equity partners join in.
CentreCourt starts work with interior designers, ad agency, consultants (mechanical, electrical, structural).
Early to mid-November
Names and logos bandied about; a wind study in the works; deal for the land closes on Nov. 15.
Mid- to late November
Floor plans being designed; ad agency designs teaser website; consultants on traffic and waste disposal weigh in.
Suite plans are completed, renderings designed. Meetings begin with real estate agents.
Jan. 3, 2014
Suite plans, prices, renderings and worksheets are released.
Jan. 11-12 weekend
Saturday: Sales agreements start to be signed. Sunday: Prices are increased. By end of weekend, 185 deals struck.
Working drawings, permits, construction.